He also said that this volatility was somewhat to be expected, because it was a bull market for many years.

“We’ve been talking so long about a market correction,” Woytassek said. “The market basically got overheated, it’s normalizing now. This is to be expected after nine-plus years of positive returns.”

Having an investment portfolio that is diverse is a great way to minimize the impacts of market volatility, Woytassek said. Investing in small, medium and large companies as well as internationally can help diversify.

Investing in out-of-market funds, like bonds or money markets also diversifies an investment portfolio.

Broad uncertainty

Market volatility, when the prices of stocks are rising and falling, has persisted through the fourth quarter of 2018 and into the new year. The S&P 500 lost more than 6 percent in 2018, its worst showing since the Great Recession.

According to Bloomberg, 2018 was a much more volatile year than 2017.

There are several factors behind the volatility.

Last week, the Federal Reserve raised the prime rate, which means that overall interest rates will go up. This has a domino effect on what happens to investors, Woytassek said, making borrowing harder and potentially slowing growth.

Bonds have an inverse relationship with interest rates, so as interest rates go up, the value of bonds goes down. People who were invested in bonds may be looking for other avenues to invest their money, Woytassek said.

Money market funds, a type of out-of-market fund, increase with interest rates, so more people may be looking to invest in these types of funds.

Dave Flynn, chair of the economics department at UND, said that uncertainty is the underlying reason for volatility.

“Whether its China, trade with Germany, questions about the Federal Reserve, the broad brush stroke is uncertainty,” Flynn said. “There has been a heightened sense of uncertainty in the past couple of months, and there has been a lot of movement on a day-to-day basis because of that.”

Trade policy and the pace of interest rate changes are the two main reasons for market volatility. And, Flynn said, the government shutdown isn’t helping things either.

“The shutdown is just adding on top of all of these other uncertainties,” Flynn said.

Facing volatility

Woytassek said he prepared his clients for market volatility by making sure they were properly invested based on their financial situations. Talking with a financial adviser is the best way to evaluate what is right for an individual's financial situation, Woytassek said.

He said he always talks to clients about the “controllables” of their 401(k) and other investments.

“I try to help my client base understand the things they can control, which are how much they are putting in and where those dollars are invested,” Woytassek said.

Woytassek also said that putting the proper amount into the savings component of a 401(k) is the first step to meeting savings goals and retiring on time.

“That savings component, how much you’re putting in, is almost more imperative than the investment side of a 401(k),” Woytassek said.